Average Operating Rate at China’s Copper Tube/Pipe Makers Down in May 2014

SHANGHAI, Jun. 20 (SMM) – The average operating rate at Chinese copper tube/pipe producers fell 1.93 percentage points in May to 85.33%, an SMM survey shows.

SMM surveyed 20 copper tube/pipe producers in China with capacity totaling 1.49 million tpy, and found that medium-sized producers posted the biggest decline.

Operating rates at large producers showed limited declines in May since leading air conditioner manufacturers maintained normal production for high-demand months of summer.

However, production at manufacturers of non-leading brands of air conditioners slowed during May since distributor stocks were already high. In addition, activity in remodeling sector cooled due to rising temperatures, cutting consumption of copper tube/pipe used in bathroom fittings and water heaters. As a result, operating rates at medium-sized enterprises were down significantly in May.

In June, the increasing inventories at air conditioner distributors are expected to affect production at most air conditioner manufacturers, so SMM predicts the average operating rate at copper tube/pipe producers will fall slightly to 84.07%.